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Apr 13, 2016

From fiction to fact: What a Stanford startup class taught me about entrepreneurship and aging

A few years back, I was one of the only 25-year-olds I knew with four octogenarian grandparents. At 85, my mom’s mom still went for long walks in her neighborhood, drove (safely), and cooked Passover feasts for thirty. A few years younger, my dad’s mom played golf (occasionally) and bridge (often) and bossed my grandfather around (with relish).

And then, in a gut-wrenching year and a half, all four of my grandparents died. For me, each loss was far more than a crack in the generational firmament — I’d counted my grandparents among my closest friends. But my experience was nothing compared to that of my parents, who even in their grief had to contend with a labyrinthine medical system, a host of insurance and estate considerations, and an endless roster of doctors, in-home care aides, and hospice workers.

And so this past winter, when a Stanford classmate (John) approached me with an idea for a startup focused on improving the lives of older adults and caregivers, I was intrigued.

The immediate impetus for our conversation was an engineering class called “Lean Launchpad.” Though not technically a business-school course, Lean Launchpad had developed an outsized reputation on campus — for its demanding requirements, and for the zeal of its teaching team. Earlier, I’d attended an info session for the course at which Steve Blank, one of three instructors, explained his philosophy on entrepreneurship:

“For years, a capstone course on entrepreneurship meant sitting around writing a business plan,” Steve said. “But what I’ve discovered through decades as an entrepreneur is that no business plan survives first contact with the customer.” Hence Steve’s favorite refrain: “Get out of the building!” — meaning, go talk to potential customers and come back when you’ve actually learned something.

John and another classmate, Deb, had already pulled together a small team to apply to the course, and with the application deadline a week or so away, asked if I wanted to join. I was moved both by the idea and by the motivations of the group — one member of our team had spent months researching technology needs of older adults; another was the primary caregiver for her aging mother. But I was also intrigued to delve deeper into what Steve liked to call “evidence-based entrepreneurship.” As jargony as the term might sound, it struck a nerve — a few years earlier, I’d worked on an early-stage startup where we’d spent six months coding a prototype that ended up flopping. I was curious to see if I might experience a better way.

Our team’s initial idea (or delusion — Steve’s preferred term) was simple. In early interviews — and through our personal experiences — we’d seen older adults forced into institutional care because of a lack of access to services like transportation, groceries, and meals. And yet, we believed that in a world of Uber, Instacart, and DoorDash, turning over one’s car keys shouldn’t mean forfeiting independence. Our solution: A phone-based concierge service for older adults, light on technology and heavy on customer service. And rather than create our own infrastructure, we’d plug into existing on-demand services to keep prices low and offerings broad.

Splash page for our initial prototype service, “Silver Concierge”

Embedded in this original idea were all sorts of assumptions, and we quickly set out to test them. For one, we imagined that most older adults either hadn’t heard of on-demand services, or lacked the technical know-how to use them. We also assumed that we’d be selling less to older adults directly, and more to their adult children (or caregivers) — and that these caregivers would successfully intermediate to deliver our product. Finally (and, perhaps, most critically), we assumed that lack of convenient access to transportation, groceries, and meals was a real and pressing pain point for older adults (and, by extension, for their adult children).

At this point, I’m going to zoom ahead three months and spoil the surprise: It turned out that almost all of our initial assumptions were either flat out wrong or somewhat misguided. And after speaking with 120 potential customers, partners, and experts — and running three MVPs/prototypes — we decided to put our project on hold.

As disappointed as we were in our inability to find real product-market fit, our three months in Lean Launchpad taught us an enormous amount, both about starting a business and about the state of aging and elder care in America:

Early on in the process, our interviews with prospective customers (caregivers) and users (older adults) produced conflicting results. Some interviewees said they loved the product, and would use it in a heartbeat; others told us that it was a “nice idea” (i.e. they wouldn’t touch it with a 10-foot pole).

Confused, we presented this conundrum to the Lean Launchpad teaching team:

Steve Blank: “Who’s your customer?”

Us: “Seniors.”

Steve Blank: “Come back when you know who your customer is.”

Steve’s point was spot-on: In defining our customer segment so broadly, we’d made it very difficult to actually learn anything from our initial interviews. Successful companies solve acute needs — and acute needs don’t exist independently from living, breathing human beings. “Seniors” is not a meaningful customer segment. “Female older adults with limited mobility living alone at home” is. As we learned first-hand, everything about our business followed from our customer segment; as such, it was critical to deeply understand who our customer was and what they cared about before trying to do anything else.

Startup lesson #2: Don’t assume anything

Steve and the teaching team were fond of calling our initial business ideas “fantasies.” At first blush, this might seem harsh — but it embodies a crucial point.

The truth is that most of our initial ideas were, essentially, fantasies — unproven yarns plucked from our own limited worldviews. As we moved forward in the class, we learned that many of the core tenets of our original business model were completely wrong. For instance: We’d assumed early on that access to groceries was a real pain point for older adults. But when we interviewed prospective customers about their needs, access to groceries almost never came up — and when it did, it barely broke into our interviewees’ top five concerns. Similarly, we’d imagined that we’d sell our concierge service to adult children, who’d then help convert their older loved ones. In reality, while many adult children were enthusiastic about our service, they were almost uniformly unable to convince their parents or grandparents to use it.

Early in the process, we assumed that, because we’d helped care for parents or grandparents ourselves, we had a decent handle on the needs and mentality of older adults. But we were wrong. Instead of starting with a solution — our phone-based concierge service — we should have spent way more time understanding the problem — conducting empathy-building interviews with older adults and caregivers. Or, as Steve might put it, we should have spent less time “company building”, and more time doing customer discovery.

Instead of starting with a solution, we should have spent way more time understanding the problem .

One reason this was difficult — and that perhaps iterating on any product can be difficult — is that people are nice. Early on, when we asked prospective users and customers about our product, we received overwhelmingly positive feedback. At one point, I posted on Facebook about a prototype of the service and was met with 200-odd likes. I don’t think I’ve collectively received that many likes in my entire history as a Facebook user. And then, when we launched our prototype two weeks later, we recruited exactly one active user — my girlfriend’s grandmother (thanks, Eva!).

The point here is that positive feedback, while very nice, may or may not be meaningful. What we should have done is remained our own biggest skeptics — and, earlier in the process, figured out ways to test how much prospective customers really liked our product (would they have pulled out their wallet? Jumped over some other hurdle?).

Startup lesson #3: Know if you’re starting a business or a hobby

An early assumption that turned out to be right was that many older adults struggle with access to transportation. In needfinding interviews, we heard manifold complaints: County buses are slow and need to be booked far in advance; taxis are unreliable, expensive, and often not outfitted for handicap use. And when we launched a landing page for a senior-focused transportation service, we saw high click-through rates and strong traffic.

At the same time, we quickly realized that starting a transportation service for older adults would be very challenging. In terms of costs, we’d probably need our own infrastructure — many older adults told us they wouldn’t feel comfortable with an Uber or Lyft. In terms of revenue, our margins would be thin — most older adults expressed extreme price sensitivity. And in terms of growth, we’d need to find novel ways of acquiring customers — online ads, for instance, wouldn’t cut it.

It’s deeply frustrating to find a real need — to see people clamoring for a service — and to walk away from it. At the same time, part of starting a business is — as our teaching team was fond of reminding us — figuring out whether you “have a business or a hobby.”

A big lesson on aging

For all that the Lean Launchpad process taught me about entrepreneurship, perhaps the biggest lesson I’ll carry with me is about aging.

When we launched our project, our team spoke a lot about “seniors” — our putative target user. But we didn’t think a ton about what this term actually meant. It’s not uncommon to lump humans into generational categories — we call very young humans infants, slightly older ones children, and then teenagers and adults. But as diffuse as these categories are, “seniors” are even more difficult to pin down. Do you become a “senior” at age 65? Or when you’re a grandparent? Or with some infirmity?

What we found was that “seniors” didn’t just make for a poorly defined customer segment; rather, the term reflected our limited understanding of aging itself. As many domain experts and older adults reminded us, aging isn’t a categorical shift. One doesn’t transform, overnight, from regular adult to “senior.” Rather — as one interviewee put it — “most of us slide into fragility and old age.”

This wasn’t just a theoretical distinction for our team. Rather, it’s a crucial realization for anyone hoping to support older adults — through a company, or through a non-profit, or even as a relative or friend.

In marking “seniors” as a categorical other, frail and dependent, we implicitly place ourselves — mere “adults” — in a false position of control. In our research, we saw this time and time again: Well-meaning but ultimately fated interventions designed to improve the lives of older adults, but through imposed change rather than earned acceptance. Of course, this was the fate of our own prototype: As enthusiastic as adult children were about our offering, they simply weren’t able to activate their parents or grandparents into actual users. This, of course, is not to advocate that we simply abandon our older relatives or friends to their own devices. Rather, we learned a much simpler notion: That older adults are, as the bromide goes, people too.

Reframing aging in this way carries with it another benefit. When we challenge “seniors” as a category, when we see ourselves not only as adults but as older adults in waiting, we gain the opportunity to think differently of our own aging process. One of the biggest challenges with elder care today — it seems to me — is that so much of it happens when you’re already old. And yet, old age shouldn’t be a surprise destination.

When we challenge “seniors” as a category, when we see ourselves not only as adults but as older adults in waiting, we gain the opportunity to think differently of our own aging process.

One of the most inspiring models of aging I learned about through this process is built on this premise. As Beacon Hill Village’s website so eloquently puts it:

In 1999, our founders, a group of friends, gathered to talk about the future. We wanted to stay engaged in our own neighborhood in this vibrant city. But we recognized that we might need support in the future.

Their solution was to found the country’s first “Village.” Villages, or Virtual Retirement Communities, as they’re also known, are organizations in which members (typically older adults) pay an annual fee to access shared resources. These fees fund a small professional staff that helps coordinate services and facilitates connections among members — helping them to continue living at home as they age.

Since Beacon Hill’s founding — and through the aid of the Village to Village Network — the model has spread. Today, 190 Villages are in operation nationwide, with an additional 150 in development. Clearly, the Village model’s call to reframe aging is finding an audience. And while we were certainly disappointed that “Silver Concierge” (our product’s working name) never found its audience, it is perhaps fitting that one of the most exciting models of better aging we learned of through our project is not the brainchild of a Silicon Valley engineer, or of a group of Stanford students, but of a group of older adults themselves.

A final addendum, and a few notes of gratitude:

I’m hardly an expert, but if you or someone you know is working on a project related to older adults, and you’d like to learn more about our experience, please don’t hesitate to reach out.

A sincere thank you to the many people who generously shared their time with us during this project. In particular, I benefited tremendously from speaking with David Wertime, Mona Lalchandani (of Exceptional Senior Placement), Janet Brush (Senior Alternatives), Dianne Savastano, Samir Malik, Jonathan Goldberg, Lily Sarafan, Susan McWhinney-Morse, Kristin Vdorick, Peter Olson and the staff of the Little House in Menlo Park, Kate Hoepke, Laura Connors, Brent Harris, Lina Pan, Sandy Dick, Barbara Flessas, Connor Diemand-Yauman, Midge Lefkowitz, Bertrand and Eva Garbassi, and Jim Bildner. Sincere thanks to you all.

An additional thank you to our wonderful Lean Launchpad mentors — Mar Hershenson and Justin Wickett — who were not only extremely knowledgeable, but also kind and supportive.

And finally, thanks to my incredible Lean Launchpad teammates: Quinlan Jung, Suzanne Adatto, Deborah Stamm, and John Deniston. Find a way to work with these caring, smart, and oh-so-hardworking people!